Parts of a Business Plan

The content of your business plan is very important. Here is a brief overview of the way a typical business plan would be organized. This is a professional document, and should have a balance between detail and clarity.

Use the following overview to create your business plan. Remember, this plan is for your use, and it will also be shown to banks and investors when you apply for funding or a loan.

Cover Sheet

Basic business info here - be sure to include contact people and phone numbers.

Table of Contents

This index can move readers in the right direction. Make sure that it is presented clearly.

Executive Summary

Because this if often the first part that is read, it must make a statement in a hurry. The entire business plan is reduced to a few paragraphs. Be sure to focus on: selling advantage, future projections, business cash requirements, payback time table, and business mission.

Business Context

Provide information that will give the reader an understanding of the larger market that you are in. Talk about growth potential, new products, and economic trends.

Business Profile

Explain in detail about your business, trends, organizational structure, influential factors in the market, patterns of research and development, contracts, and operational procedures.

You need to show that you have thought out what could happen with your market and how your business will respond. Focus on dealing with the competition, your weaknesses and corrections, legal issues, and staffing issues.

Marketing Plan

This is probably the most important part of the plan. You need to have the following: a marketing strategy, pricing scheme, timetable for growth and development, marketing budget, guarantee policies, packaging and presentation, plan to test the effectiveness of your marketing, and knowledge of what certain media marketing costs.

Financials

Yuck! Entrepreneurs tend to hate this section most. Bankers tend to look at it first. Spend some time here. You need a Profit and Loss Statement, Balance Sheet, and Cash Flow Statements (for next three years). If you don't know what these are, talk with your accountant and learn how to read these reports. Banks often look only at this section. Make your banker happy!

Time Table

This part talks about when you need the financing to come into the plan, lists parts of the marketing campaign (including dates), and gives the scheduled dates of production (when you actually will deliver the goods/services).

Summary of Needed Capital

Sum up why you want their money. Banks will usually loan money for equipment and raw materials or inventory (things they can sell off if you default). Do not ask a bank for only "Operating Capital".

Appendix

You could include footnotes, supporting documents, reports, biographies, graphs, copies of contracts, glossary of terms, and references.